Village of the Giants takes place in fictional Hainesville, California. After crashing their car into a roadblock during a rainstorm, a group of partying, big-city teenagers first indulge in a vigorous, playful mud-wrestling fight, then hike their way into town. Fred remembers meeting a girl from Hainesville named Nancy, and they decide to look her up.
Nancy, meanwhile, is with her boyfriend Mike, while her younger brother "Genius" plays with his chemistry set in the basement. Genius accidentally creates a substance he names "Goo", that, when consumed, causes animals, including a pair of ducks, to grow to gigantic size.